May 15 (Bloomberg) -- DDR Corp. agreed to buy Blackstone
Group LP’s stake in a group of U.S. shopping centers operated
under a joint venture between the companies for $1.46 billion.

DDR will acquire Blackstone’s interest in 30 of the 44
shopping centers in the venture, the Beachwood, Ohio-based real
estate investment trust said today in a statement. New York-based Blackstone has a 95 percent stake in the properties.

“The acquisition will be funded responsibly, and will
position us well for strong relative growth in cash flow
generated by high-quality shopping centers over the long term,”
David Oakes, DDR’s chief financial officer, said in the
statement.

Shopping-center rents and occupancies are climbing as the
economy grows. The properties in the acquisition, including
Fairfax Towne Center in Washington and Shoppers World in Boston,
are prime centers located in the U.S.’s top 40 metropolitan
areas, DDR said. For Blackstone, the sale will allow it to
realize a profit and return money to investors in its $13.3
billion Blackstone Real Estate Partners VII fund.

The two companies announced the partnership in January 2012
to buy 46 shopping centers from a unit of Elbit Imaging Ltd. The
deal was completed in June, DDR said in a statement at the time.

DDR plans to fund the acquisition through the assumption of
$398 million in existing debt, almost $150 million from the
repayment of preferred equity and mezzanine loans, and from the
issuance of equity and unsecured debt. DDR also has the right,
subject to certain conditions, to issue common shares to
Blackstone in an amount of as much as $250 million.

Dick’s, PetSmart

The average base rent of properties in the portfolio is
$13.81 a square foot. The centers are 95 percent leased, DDR
said. Retailers at the properties include Bed Bath & Beyond
Inc., Dick’s Sporting Goods Inc. and PetSmart Inc.

The 14 properties DDR isn’t buying will remain in the
venture. DDR will continue to handle management and leasing of
those centers.

Peter Rose, a spokesman for Blackstone, declined to comment
on the transaction.